The company's scrip rose by 5.52 percent to Rs 18.33 on the BSE. At the NSE, the stock was up 5.74 percent to Rs 18.40. BSNL and MTNL did not take part in the 2010 spectrum auction and had been asked to match the price paid by the successful bidder for the airwaves. Both companies offered to surrender their spectrum and sought refunds of payments made.

BSNL had paid Rs 8,313.8 crore, while MTNL paid Rs 4,534 crore.

BSNL is returning part of the spectrum and will get Rs 6,724.51 crore as refund, while MTNL, which operates services in Mumbai and Delhi, will receive Rs 4,533.97 crore.

The GoM had also decided that the government would bear the pension burden for about 43,000 MTNL employees absorbed from the Department of Telecom.

After losses widened for nine quarters in a row, MTNL reported that its standalone net loss narrowed to Rs 947 crore in July-September period, mainly after lowering provisions for retirement benefits.